Partial 2025 U.S. Shutdown Triggers Furloughs, Risks

The partial U.S. government shutdown that began Oct. 1, 2025, has furloughed large numbers of federal employees, paused pay for many, and prompted OMB warnings about possible permanent layoffs. Furloughed workers are being directed to check state Unemployment Compensation for Federal Employees (UCFE) rules, and the Department of Education has been especially hard hit—roughly 80–87% of staff are furloughed—halting civil‑rights investigations and new grant actions even as Pell Grants, federal loan servicing and FAFSA processing continue for now with reduced support. Analysts warn of hidden long‑run costs from furloughs—one study finds furloughed employees are about one‑third more likely to quit within a year and suffer morale losses comparable to roughly a 10% pay cut—and the shutdown is delaying key economic data releases, including the monthly jobs report, complicating policy and market decisions. A separate policy risk is that enhanced ACA premium tax credits enacted under the Biden administration are due to expire without congressional action, which KFF says would sharply raise premiums for subsidized enrollees next year. Some government contractors with funded backlogs, international revenue or contractual protections (for example, CACI, Leidos and CGI) may be cushioned from near‑term sales impacts, while firms with heavier federal civil exposure face sharper revenue and stock‑valuation risks; contractors are advised to monitor agency contingency guidance, contract clauses, and labor rules such as the WARN Act to manage operations and financial exposure.